Hi sercher,
maybe I misunderstood but, are you trying to read from SPI without write on it?
Remember that if the niosII is the master of the SPI transaction you have to write N bytes on the MOSI pin even if you wanna read N bytes. This because the slave is essentially a shift register and if you don't do this, it don't reply. Perhaps is this your problem?
Try to use the alt_avalon_spi_command() function:
this one first write X bytes and then read Y bytes (during this last operation it send 0 to the slave). I agree that if you have only to read, this is an oversized function, but it's a first step...